US tech whipsawed again amid AI hunger for cash

US semiconductor and chip companies whipped lower in overnight trading as the looming listing of SpaceX and upcoming capital raisings from Alphabet, Anthropic and OpenAI to fuel their artificial intelligence ambitions have investors making room to participate in the offerings.

The blue-chip Dow Jones Industrial Average advanced with Home Depot at the top of the leaderboard, while a decline in oil prices bolstered carriers such as American Airlines.

Wall Street’s fear gauge crept higher amid heightened tensions in the Middle East after President Donald Trump accused Iran of shooting down an American helicopter, while the kiwi dollar remained subdued.

Meanwhile, Australian futures are pointing to a positive start to the day on the ASX, while trans-Tasman retailer KMD Brands will be in view amid reports that private equity firms are interested in the company, currently working through a strategic review.

Volatile times

Chip stocks were again at the forefront of investors minds on Wall Street, with the likes of Nvidia, Intel and Marvell Technology reversing course in a broadly softer day for companies backing the AI theme as the Nasdaq Composite dropped 1.1% in late trading.

The upcoming listing of SpaceX on Friday has reportedly been heavily oversubscribed, while Alphabet’s upcoming US$84.75 billion capital raising and initial public offerings by Anthropic and OpenAI were prompting some investors to tweak their portfolios to make room for the new opportunities.

Other sectors fared better overnight, with the Dow up 0.2% as Home Depot, Sherwin-Williams and Nike led the blue-chip index higher, while US carriers followed Asian airlines higher as oil prices eased. Brent crude oil futures fell 3% to US$91.41 a barrel at 7am in Auckland amid reports that more fuel was making it through the Strait of Hormuz.

Energy prices largely shrugged off the latest developments in the Middle East, as US President Trump threatened a response to Iran shooting down an Apache helicopter. Still, the CBOE volatility index rose 5.3% to 19.82, while the Polymarket prediction market was pricing a 20% chance of a deal being reached by the end of the month and a 34% chance by the end of July.

Snowcapped mountains

Vail Resorts dropped 3.6% after cutting its annual guidance as low snowfall in the western US weighed on visitor numbers, providing a soft lead for the likes of NZX-listed Tourism Holdings.

“For NZ investors, falling oil prices provide a welcome tailwind for transport, tourism and consumer-facing businesses, but the bigger driver remains global technology sentiment,” Moomoo market strategy consultant Greg Boland said in a note. “With AI stocks once again under pressure and key US inflation data looming, markets are likely to remain headline driven.”

Australian futures were pointing to a 0.1% gain for the S&P/ASX 200 index when trading opens across the Tasman, while the kiwi dollar traded at 58.20 US cents at 7am from 58.29 cents yesterday.

KMD Brands, which has observed increased trading volumes so far this month, has attracted interest from private equity buyers, according to The Australian’s DataRoom column. The trans-Tasman retailer is working through a strategic review of its business, and its biggest shareholder, Allan Gray, has previously urged the board to sell parts of the business.

Local data today include ANZ’s monthly Truckometer traffic gauge, which will have a bearing for courier operator Freightways and logistics firms Mainfreight and Move Logistics.

Meanwhile, New Zealand’s S&P/NZX 50 index faces headwinds from companies going ex-dividend including Kiwi Property Group, Napier Port Holdings, Tower, and Goodman New Zealand.

And rural companies such as PGG Wrightson will be in view as the Fieldays agricultural event kicks off at Mystery Creek in Waikato.

Reporting by Paul McBeth. Image from Y M on Unsplash.